Post-mortem brains from Down syndrome (DS) and Alzheimer's disease (AD) patients show an upregulation of the Down syndrome critical region 1 protein (DSCR1), but its contribution to AD is not known. To gain insights into the role of DSCR1 in AD, we explored the functional interaction between DSCR1 and the amyloid precursor protein (APP), which is known to cause AD when duplicated or upregulated in DS. We find that the Drosophila homolog of DSCR1, Nebula, delays neurodegeneration and ameliorates axonal transport defects caused by APP overexpression. Live-imaging reveals that Nebula facilitates the transport of synaptic proteins and mitochondria affected by APP upregulation. Furthermore, we show that Nebula upregulation protects against axonal transport defects by restoring calcineurin and GSK-3β signaling altered by APP overexpression, thereby preserving cargo-motor interactions. As impaired transport of essential organelles caused by APP perturbation is thought to be an underlying cause of synaptic failure and neurodegeneration in AD, our findings imply that correcting calcineurin and GSK-3β signaling can prevent APP-induced pathologies. Our data further suggest that upregulation of Nebula/DSCR1 is neuroprotective in the presence of APP upregulation and provides evidence for calcineurin inhibition as a novel target for therapeutic intervention in preventing axonal transport impairments associated with AD.